India’s life insurance industry witnessed a moderation in growth during May 2026, with new business premiums (NBP) rising 5.1% year-on-year (y-o-y) to ₹32,030.9 crore, according to a report by CareEdge Ratings. The slowdown came after a strong start to FY27 and was largely attributed to normalisation in group single-premium business and base effects.
The industry had recorded stronger growth in April 2026, while May saw a softer performance as growth in the group single-premium segment, the largest contributor to industry premiums, eased to 2.8% y-o-y. Despite the moderation, the underlying demand environment remained healthy, supported by continued traction in retail products.
Individual segment drives growth
Growth during the month was led by the individual non-single premium segment, which expanded 13.5% y-o-y. The report noted that higher ticket sizes and a shift towards higher-value policies contributed to the increase.
Private insurers continued to outperform the market, posting 7.7% growth in new business premiums compared with 3.5% growth for Life Insurance Corporation of India. As a result, private insurers’ market share increased marginally to 39.6% in May 2026.
However, LIC remained the dominant player, accounting for nearly 60% of industry new business premiums. The insurer also launched two new products—New Jeevan Sathi (single premium) and New Jeevan Sathi (limited premium)—effective June 1, 2026. On a year-to-date FY27 basis, industry new business premiums remained robust, growing 19.4% y-o-y.
APE growth remains healthy
Annualised Premium Equivalent (APE), a key measure of life insurance sales, grew 7.5% y-o-y in May 2026. Private insurers reported a strong 14.5% increase in APE, while LIC’s APE declined 2.1% during the month.
Despite the moderation, cumulative APE growth for the first two months of FY27 remained healthy at 14.6% y-o-y, driven by private insurers’ strong business momentum.
Policy volumes show mixed trend
Individual non-single policy volumes remained largely stable, declining marginally by 0.1% y-o-y in May. Private insurers registered a 5.1% increase in policy volumes, whereas LIC’s policy count fell 3.1%.
On a cumulative basis, policy volumes grew 5% y-o-y during FY27 so far, led by a 13.7% rise among private insurers. LIC’s policy volumes remained broadly flat.
Industry outlook remains positive
CareEdge Ratings Senior Director Sanjay Agarwal said, “India’s life insurance industry continued to expand in May 2026, although the pace of growth moderated from the strong momentum seen in previous months. Despite these near-term headwinds and volatility in equity markets, the industry maintained strong momentum during the first two months of FY27, with new business premiums growing by 19.4% y-o-y as of YTDFY27.”
He added that the industry is expected to maintain medium-term growth of 8%-11%, supported by product diversification, regulatory initiatives and increasing insurance penetration.
CareEdge Ratings Associate Director Saurabh Bhalerao said private insurers continued to gain market share on the back of stronger growth in premiums and APE, while LIC retained its leadership position. He added that increasing digital adoption, distribution expansion and a gradual shift towards regular-premium products are expected to support sustainable growth and profitability in the sector.